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Mr Cooper is referring here to a part of Bill C-14 which would amend the Borrowing Authority Act to raise the maximum amount of outstanding debt to $1.831 trillion. But he then conflates that figure with the current deficit and wrongly implies this is a spending plan.
1/ https://twitter.com/cooper4sae/status/1354581234719068166
1/ https://twitter.com/cooper4sae/status/1354581234719068166
The current limit of the Act is $1.168 trillion, which was set in 2017. Note that the Act limits the total borrowings by Canada, which often exceeds the accumulated deficits. The Act also requires triennial tabling of a report on borrowing. A report was tabled this past fall.
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It probably shouldn’t come as a surprise to anyone that the 2020-21 deficit meant that Canada was approaching the existing debt ceiling. The new limit would presumably provide assurances that Canada can borrow *if and as needed* for the next several years.
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Borrowing needs, of course, are largely determined by the size of the deficit. That, in turn, is determined by how much more the Government spends than raises in revenue. In order to spend money, funds must be appropriated by Parliament.
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Parliament also, of course, can set tax rates and otherwise raise revenues. So, the deficit’s size is always ultimately within Parliament’s control.
Complaining about the borrowing limit, therefore, is like complaining about a restaurant bill after ordering a large meal.
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Complaining about the borrowing limit, therefore, is like complaining about a restaurant bill after ordering a large meal.
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It is certainly open to Mr Cooper to complain that the Government is spending too much or that the deficit is too large (although most of the COVID spending measures received unanimous consent). But it is wrong to suggest that a borrowing limit is a spending plan.
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